“Dram Shop” Laws Hold Bars Responsible for Alcohol Injuries

Drinking liquor is a personal choice, so it may seem unfair that bar owners can be liable for accidents and injuries that occur because someone chose to drink in their business establishment.


Under the terms of “dram shop laws,” owners of a bar or any other business that sells alcohol can be held legally responsible for what their customers do after they’ve been drinking. Dram shop laws vary somewhat from state to state.

Responsibility for Limiting Your Customers
If you own a bar, you’re required by law to keep an eye on your patrons to make sure they’re not over-drinking. In most states, you must also train your staff to do so. If a customer causes injury to someone else because he drank alcohol that you served, by causing a car accident, for example, or getting into a fistfight, you may be just as liable for a personal injury or wrongful death lawsuit as your customer. The law obligates you to take steps to stop a clearly intoxicated patron from drinking any more. In some states, serving alcohol to an intoxicated person can result in criminal charges.

You May Not be Responsible for Your Customers’ Injuries
Some state laws won’t hold you responsible if an inebriated patron injures only himself. This might be the case if a patron falls off a bar stool or drives into a tree on the way home. Your customer typically cannot sue you for damages for medical costs, for time lost from work, or for pain and suffering because it was the patron’s personal decision to drink too much.

Some States Limit Damages
Dram shop laws in some states recognize that you and your business are not the only ones responsible for stopping an already-intoxicated patron from consuming even more alcohol. In these states, the drinker is at least equally responsible, because the drinker is the one who chose to overindulge. These jurisdictions limit the amount of damages a victim can sue you for if your patron injures someone else due to inebriation. If a judge or jury awards more than this amount to the victim, the drinker or the drinker’s insurance policy are responsible for coming up with the difference.

Most States Require Insurance Coverage
Because bar owners are liable for the actions of their customers, many states require that bars carry liquor liability insurance in addition to general liability coverage. But these insurance policies have limitations. They won’t cover your business if you serve someone illegally, such as someone who is underage or, in some states, obviously drunk.

A Business Lawyer Can Help
The law surrounding dram shop laws and bar liability is complicated. Plus, the facts of each case are unique. This article provides a brief, general introduction to the topic. For more detailed, specific information, please contact a business lawyer.

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